Contracted services are central to public service delivery in the UK. Private and voluntary sector organisations are now very large suppliers of taxpayer funded programmes - for example in health, care of older people, employment, and probation. In addition, almost all public sector organisations outsource aspects of their IT, facilities management and other support functions.
Both in-house and outsourced services have enjoyed their share of successes and failures. More recently however, high-profile problems with specific outsourcing arrangements appear to have undermined public confidence in outsourced service provision as well as the government's ability to manage these contracts.
One reason for this low confidence is that there is little public information on how well these contracts are performing. From the data that is currently available to the public, it is difficult to tell whether media stories about specific contracts fairly represent the performance of suppliers, let alone the effectiveness of outsourced provision as a whole. The current opacity of contracting arrangements also makes it difficult for potential suppliers to spot opportunities to step in and offer a better service at lower cost to taxpayers.
When we started the work summarised in this document, many organisations had already demonstrated the need to address this unsatisfactory state of affairs. The Confederation of British Industry (CBI), the National Audit Office (NAO), the Information Commissioner's Office (ICO) and the Public Accounts Committee had all made various commitments to increased transparency of outsourced services, as had various government departments and politicians.
Much attention was being paid to ensuring that freedom of information requests could be applied to outsourced services so the Institute focused on another area - using contractual arrangements to encourage regular publication of information about performance to the public. And while it was clear there was broad agreement for something like this in principle, there was a need to translate this agreement into action.
To move forward, we convened a taskforce comprising of representatives from government, industry, the voluntary sector (NCVO) and independent organisations such as ICO, NAO and Open Data Institute (ODI). The aim of this taskforce was to devise a set of detailed and legally robust obligations that everyone - government, private providers, and the voluntary sector alike - could sign up to and adopt.
The taskforce agreed that these new transparency provisions would focus on the issues that mattered most to the public - the fees paid to government suppliers, their performance and details of major subcontracting arrangements. The hard part was defining the scope, working through the detail and translating this aspiration into a set of workable provisions.
I am immensely grateful to all those who have helped make sure that the provisions outlined in this document were sufficiently specific to be meaningful, while also being broad enough to allow them to be used as a starting point for a range of contracts. While this publication represents significant progress, it is still just the beginning. The Institute - like many of those involved in the process - will continue to support government efforts to increase transparency in this area and to monitor how widely these provisions for transparency are adopted.
Sir Ian Magee, Senior Fellow, Institute for Government